Tuesday, September 14th 2021
Rare Earth Metal Prices Are Skyrocketing, Electronics Prices Expected To Follow
If it wasn't bad enough that we're in the middle of a pandemic, which has resulted in major shipping issues globally and a semiconductor shortage, it now looks like electronics are likely to get even more expensive due to skyrocketing prices of many rare earth metals.
Nikkei is reporting that many often overlooked materials, such as neodymium and the lesser known praseodymium, have increased by almost 74 percent since the same time last year and that's only one of several key materials that have increased in price by 50 percent or more in a year.
It's no secret that lithium has increased in price and it now costs about 150 percent of what it was costing last year. However, many other, less obvious materials have also increased in price, with copper up over 37 percent and tin up almost 82 percent in a year. To TPU's readers this mainly means that you can expect higher costs for PCBs and all the components that are soldered onto them, as tin is used to solder just about every component in place.
Neodymium and praseodymium are used in everything from simple speakers, to electrical car motors to wind turbines. With prices continuing to go up, as the demand is increasing due to governments in many western countries switching to a green economy and focusing on electrification of cars, while at the same time trying to go fossil fuel free, seems to be an undertaking that is poorly timed with the current state of the electronics industry.
Other materials like terbium oxide, which is used in LEDs, flat panel displays and high-temperature fuel cells among other things, have gone up by over 60 percent in price. Even good old aluminium is up over 55 percent, which means more expensive parts in just about everything that uses a lightweight metal structure or housing.
As the report goes, China controls 55 percent of the global market when it comes to production of rare earth metals and 85 percent of the refining process. The Chinese government has been putting tighter export controls in place this year, which is also part of the reason for the increase in costs. This might be a way for the nation to try and fight back against some of the trade disputes that have arisen with the US, but it's clearly affecting every nation in the world, as China is without a doubt the world's manufacturing hub.
What China seems to have missed though, is the fact that this is affecting local Chinese companies as well, since increased material costs have caused their profits to tumble, as they often have long term contracts with their business partners that can't be renegotiated easily. As such, many small and mid-sized Chinese suppliers are suffering losses and if this continues we might see some of these companies go out of business. Large, international corporations aren't unaffected by these price increases either, since at some point they're going to have to increase their prices to the end customer of their products, which is likely to translate into fewer sales.
Right now, a lot of negotiations are taking place all around the world to try to maintain pricing, but someone, somewhere is going to have to eat the cost and that can only go on for so long. So far, Sonos has already increased the pricing of its speakers, by anything from $10 to $100 depending on the product. This might be a sign of things to come, as Sonos is unlikely to be the only company to adjust prices accordingly.
Source:
Nikkei
Nikkei is reporting that many often overlooked materials, such as neodymium and the lesser known praseodymium, have increased by almost 74 percent since the same time last year and that's only one of several key materials that have increased in price by 50 percent or more in a year.
It's no secret that lithium has increased in price and it now costs about 150 percent of what it was costing last year. However, many other, less obvious materials have also increased in price, with copper up over 37 percent and tin up almost 82 percent in a year. To TPU's readers this mainly means that you can expect higher costs for PCBs and all the components that are soldered onto them, as tin is used to solder just about every component in place.
Other materials like terbium oxide, which is used in LEDs, flat panel displays and high-temperature fuel cells among other things, have gone up by over 60 percent in price. Even good old aluminium is up over 55 percent, which means more expensive parts in just about everything that uses a lightweight metal structure or housing.
As the report goes, China controls 55 percent of the global market when it comes to production of rare earth metals and 85 percent of the refining process. The Chinese government has been putting tighter export controls in place this year, which is also part of the reason for the increase in costs. This might be a way for the nation to try and fight back against some of the trade disputes that have arisen with the US, but it's clearly affecting every nation in the world, as China is without a doubt the world's manufacturing hub.
What China seems to have missed though, is the fact that this is affecting local Chinese companies as well, since increased material costs have caused their profits to tumble, as they often have long term contracts with their business partners that can't be renegotiated easily. As such, many small and mid-sized Chinese suppliers are suffering losses and if this continues we might see some of these companies go out of business. Large, international corporations aren't unaffected by these price increases either, since at some point they're going to have to increase their prices to the end customer of their products, which is likely to translate into fewer sales.
Right now, a lot of negotiations are taking place all around the world to try to maintain pricing, but someone, somewhere is going to have to eat the cost and that can only go on for so long. So far, Sonos has already increased the pricing of its speakers, by anything from $10 to $100 depending on the product. This might be a sign of things to come, as Sonos is unlikely to be the only company to adjust prices accordingly.
42 Comments on Rare Earth Metal Prices Are Skyrocketing, Electronics Prices Expected To Follow
Holy hell. Prices had been moving up at my work, but I didn't know it jumped that much. This also probably explains why we dropped one scrap metal company for sending scrap to because they wouldn't come up on pricing, so we changed to another vendor that gives almost $.25 more a pound.
"Right now, a lot of negotiations are taking place all around the world to try to maintain pricing, but someone, somewhere is going to have to eat the cost and that can only go on for so long. So far, Sonos has already increased the pricing of its speakers, by anything from $10 to $100 depending on the product. This might be a sign of things to come, as Sonos is unlikely to be the only company to adjust prices accordingly."
Time to let the government know that $15/hr working fast food joints isn't good enough anymore, the minimum wage needs to be pushed to $25/hr so we can all be rich flipping burgers!
Looking at the link below, the last and only time it was as expensive as now, was in 2008.
tradingeconomics.com/commodity/aluminum
A normal (pre forced economic shut down) year, we'd see a normal ebb and flow for business. Things would start picking up around the end of March and get busy throughout spring and into early fall - usually about start of November. Then things would slow down, much like the construction season in the Midwest. But all of last year since December and based on order forecasting from customers, we're looking to keep production ramped up as much as possible to try and meet demands.
On top of it all, owners have been turning away more new customers than we've been bringing on simply because we don't have the capacity to keep up with all our existing customers if we keep brining in more and more new ones that eat up press time. So many companies are having issues with their current extruders keeping up or prices going up that they're looking to outsource their needs to other extruders, even if it means they're halfway across the US. We got companies in Texas wanting us to take their metal business and ship things from Minnesota out to them. We've got a new customer that drives up out of Iowa because he can get material faster from us than from his local extrusion company.
Right now, for us, business is booming and at least looks to stay that way for the next 6 months. But, who knows what the future holds. We can be slammed one year and a lull the next.
Thank you consumers for being greedy and brainwashed by marketing. Because you "need" all the shiny toys even during a pandemic and price increases, I can retire years ahead of the plan.
Tell Microsoft that about win-11 security spec's lol
useless free markets.
This news is sure to cheer everyone up....
Just don't buy anything, eventually if everyone fallows suit prices will come done............................keywords being 'if everyone'
I think wallstreet wants to make some money after the gamestop fiasco lol
Know how you can stop the bs? just don't buy overpriced products.Where I live I can buy it for 750 usd and still having doubts because i have a 28 4k monitor 60hz working without any problem and seems all right, an oled 48 inch 120hz would be awesome.
Side stepped referring to mining didn't they lol :roll: